When you're accessing from your phone (at least when not on your home WiFi) or a computer that's not at your house, it would access the one in the cloud, which would make it faster and not rely on your home Internet working.
Most importantly, if your house burns down, you're not totally fucked.
So the local device interfaces with TVs and such and keeps you from having to wait for anything to download because it's all cached on there. The cloud piece keeps your data safe and makes it a lot less likely that you won't be able to access your data because your Internet is down.
It's possible that you could use Dropbox as the cloud piece and sync mechanism and put together a special server that can do all of the TV/remote control/stereo integration he wants.
One issue is that even 100GB may not be enough for everyone.